Energy storage system procurement contract

What is the contract structure for a battery energy storage system?

The contract structure has not. Two main issues should be considered when developing a battery energy storage system or “BESS” project. The first is the general contracting structure. The second is key pitfalls when drafting and negotiating specific contracts. This article focuses on the contract structure. Turnkey v. Separate Contracts

How do energy storage contracts work?

For standalone energy storage contracts, these are typically structured with a fixed monthly capacity payment plus some variable cost per megawatt hour (MWh) of throughput. For a combined renewables-plus-storage project, it may be structured with an energy-only price in lieu of a fixed monthly capacity payment.

Do distribution-connected energy storage projects need an interconnection agreement?

Distribution-connected energy storage projects must have an interconnection agreement with the utility. All projects that would operate like a generator (as opposed to a wire) must interconnect under Wholesale Distribution Access Tariff (WDAT), which is regulated by the Federal Energy Regulatory Commission (FERC).

What is California's energy storage procurement framework?

Ecosystem for Project Deployment Since the time of Assembly Bill 2514 and through 2021 California built a rich ecosystem for energy storage research and development, commercialization, and project deployment. The PU’s Energy Storage Procurement Framework provides crucial motivation to the development of both demand and supply in this marketplace.

Does the Pu's energy storage procurement framework support workforce development?

The PU’s Energy Storage Procurement Framework provides crucial motivation to the development of both demand and supply in this marketplace. In this section we describe evidence of workforce development with a focus on the energy storage supplier activity.

How do energy storage contracts work in California?

Most of the energy storage contracts executed by the California utilities have either a fixed flat price that remains constant over time or a price schedule escalating annually at a set rate. Figure 16 below summarizes the IOUs’ energy storage contract prices over time, with data aggregated by grid domain and type of contracts.